Commercial Real Estate Growth Highest at Billion-Dollar Banks

Banks with assets between $10 billion and $50 billion reported the highest commercial real estate loan growth in 2012, according to data from SNL Financial.

Total CRE loans at commercial banks grew by $9.09 billion, or 0.94%, during the fourth quarter of 2012, amounting to $971.27 billion at Dec. 31, 2012, said SNL Financial, a Charlottesville, Va.-based data and analysis firm.

That category also had a median delinquency rate of 2.76% with banks with greater than $50 billion of assets experiencing a median decline of 3.29% in their CRE portfolio, according to SNL Financial.

The fourth quarter growth in CRE loans may point to a sign that commercial banks are starting to heal, the firm noted, adding their aggregate delinquency rate is at the lowest level in the last 16 quarters.

At the end of 2012, the CRE delinquency rate was 4.29%, which was down from a peak of 10.76% in March 2010 and the lowest level since 3.1% at the end of 2007, according to the data.

SNL Financial said all of the components of CRE loans, except construction and land development loans, had positive growth during the fourth quarter of 2012.

Loans not secured by real estate and multifamily loans grew by 3.35% and 2.83%, respectively, during the quarter while the construction and land development segment, down by 3.22%, continued to decrease.

Meanwhile, the total number of credit union business loans is still dwarfed by the amount offered by banks. According to CUNA, credit unions hold less than 6% of all small business loans for a combined value of nearly $40 billion.